China is holding petroleum that was heading to North Korea from Iran in an apparent attempt by Beijing to maintain its control over Pyongyang, sources said.

According to Chinese sources, the petroleum was part of North Korea’s contract to import about 500,000 tons of condensate, a light oil, from Iran. North Korea, seeking to diversify its energy sources, started discussions on the deal last year.

The agreement was reached with the cooperation of a major Chinese state-run petroleum company.

The condensate is believed to have been shipped from Iran over a number of occasions on tankers registered to a third nation. But Chinese authorities ordered the tankers to stop when they reached the Chinese coast in the Yellow Sea this spring.

The ships were then towed to ports in Dalian, Liaoning province, and Qingdao, Shandong province. Sources said the condensate remains in those ports, which have restricted access to outsiders.

China is believed to have asked North Korea to pay about $2 million (about 196 million yen) for storage expenses.

“Once China realized that North Korea was beginning to depend on Iran for petroleum, China began using various measures to remain engaged so it can maintain its influence over North Korea,” a diplomatic source knowledgeable about relations between China and North Korea said.

Under the North Korea-Iran contract, Pyongyang is to pay Tehran for the condensate, but the condensate itself must be first sent to a Chinese state-run petroleum company.

“Because North Korea does not have the most advanced refineries, it had to ask China to refine the condensate,” a source in the petroleum industry said.

It is unclear what legal basis China is using for holding up the shipments because condensate and other petroleum products needed for daily living are not banned under U.N. economic sanctions imposed against North Korea.

However, one source involved in the transaction said, “As part of the economic sanctions that were imposed against military actions taken by North Korea, inspections were carried out by Chinese authorities, which asked that the petroleum be kept at the port.”

…

Until now, China is said to have provided about 80 percent of the petroleum used in North Korea. The main means of transport were through a pipeline that runs along the Yalu River between the border of the two nations as well as by ship.

According to Chinese customs statistics, the export volume was about 520,000 tons a year.

…

“Not only has a ban on petroleum export shipments been imposed by China, but the total import volume through the pipeline has also been reduced to one-third the level of the same period of the previous year,” a source involved in trade between China and North Korea was told by a North Korean government source in September.

China remains North Korea’s biggest backer, even with the contract with Iran.

Read the full story here:
China holding up shipment of Iranian petroleum to North KoreaAsahi Shimbun
Koichiro Ishida
2013-10-20

China’s exports of crude oil to North Korea rose 8.2 percent last month from a year earlier, a report said Wednesday.

China shipped 106,000 tons of crude oil to the North in March, the Washington-based Voice of America (VOA) said, citing data by China’s customs.

The total volume of crude oil export from China to North Korea during the first three months of this year reached 159,000 tons, up 6.7 percent from a year earlier, the report said.

The news outlet confirmed previous media reports that China did not export crude oil to the North in February, which was attributed to the superpower’s tightened implementation of economic sanctions on the communist country for its third nuclear test on Feb. 12.

VOA said, however, that China, the North’s closest ally, had no records of crude oil exports to the North in February in 2012 and 2011.

According to China’s customs, the country shipped a total of 523,000 tons of crude oil to the North in 2012, 526,000 tons in 2011 and 528,000 tons in 2010.

Besides official trade, China is believed to have ship an additional 500,000 tons every year in crude oil assistance to the North.

There are also media reports that Iran is planning on selling oil to the DPRK. According to RT News:

Tehran and Pyongyang are in talks about possible exports of Iranian oil to North Korea, Iran’s oil ministry said on Saturday.

“We have had, and continue to have, negotiations with the North Koreans who have requested to buy Iranian oil. We are discussing the procedure and we don’t have any problem selling them oil,” Iranian Oil Minister Rostam Qasemi told a briefing at an International oil and gas exhibition in Tehran.

The minister admitted that Iran was feeling the strain of sanctions imposed on the country by foreign governments, but said it would not get in the way of the transportation of its oil to “any country, in any part of the world,” AP cites.

A delegation from North Korea is among the participants of the expo in the Iranian capital. A Tehran-Pyongyang oil deal would further develop ties increase between the two states – which are both at odds with the US and the West over their respective nuclear programs and have both been sanctioned over the issue.

Top: A reader allowed me to post this image (thank you) of a mosque in Pyongyang. Bottom: The Google Earth image of the mosque.

The mosque is located inside the Iranian embassy compound. This would make it a Shia mosque. There is not a mosque at either the Egyptian embassy or the Pakistani embassy. I am unsure of the location of the Libyan embassy (do any readers know?) or whether it has a mosque. In the meantime, the DPRK might be the only country with a Shia mosque but not a Sunni mosque.

If the embassy staff are good Muslims, they should allow you to enter the compound to visit the mosque. Just be sure to bring modest clothes, and women, please cover your heads.

This weekend KCNA/KCTV reported on Kim Jong-un’s visit to the newly built Taesongsan General Hospital (대성산종합병원). Pictured above is the Google Earth satellite image of the place. Google Earth coordinates: 39.109678°, 125.911093°. NK Leadership Watch has more information on the Hospital.

UPDATE (2011-10-10): According to the Jordan Times, the Bank denies any involvement:

The Arab Bank on Sunday stressed that it has never dealt with the government of North Korea or Tanchon Bank, which the US has accused of being the primary financial agent behind Pyongyang’s weapons programmes. “Based on a review of its customer account and transaction records, Arab Bank does not believe that it has conducted business with the government of North Korea or Tanchon Bank,” a spokesperson from the Arab Bank said.

In a diplomatic cable sent by the US State Department to the US embassy in Amman in August 2007, officials warned that the Arab Bank could be unwittingly assisting proliferation-related transfers between Iran, Syria and North Korea. “We are concerned that Iran, Syria and DPRK [Democratic People’s Republic of Korea] proliferation entities are using the Arab Bank network to process what may be proliferation-related transactions,” read the cable, released by WikiLeaks on its website at the end of August and viewed by The Jordan Times.

According to the cable, the US knew that as of 2007, North Korea’s Foreign Trade Bank mission in Tripoli, Libya (FTB Libya) had expanded its role in North Korea’s banking network and was helping Tanchon Commercial Bank, the banking arm of North Korea’s primary weapons trading firm, KOMID, to move funds from both Syria and Iran.

It added that in 2007, FTB Libya provided assistance to Tanchon in making remittances from funds from the sale of unspecified, probably proliferation-related goods in Syria.

“Our information indicates that Tanchon is establishing this new arrangement because Tanchon could no longer remit funds through a route it had previously used. FTB Libya arranged remittance routes for Tanchon from Syria and other locations via intermediary banks… We have information that Tanchon’s financial transfers are conducted surreptitiously by using either aliases or front companies,” the US State Department said in the cable.

The US reportedly claimed that the transfers, which were probably proliferation-related, occurred inside the Arab Bank network and involved both Arab Bank branches and the Arab Tunisian Bank, of which, according to the US, the Arab Bank is a 64.2 per cent stakeholder.

In the cable, the State Department called on Jordan to maintain vigilance with regard to Syrian, Iranian and North Korean financial transactions in its jurisdiction to prevent these countries from using deceptive financial practices to further their proliferation-related activities, urging appropriate authorities to investigate such transactions.

The Arab Bank spokesperson told The Jordan Times that the bank has not found any records indicating that Jordanian government officials provided it with information concerning surreptitious efforts by North Korea to move funds through its network.

Citing the cable’s reference to “deceptive financial practices” by North Korea, the spokesperson emphasised that without knowing the details of these efforts by North Korea to conceal its financial transactions, it is not possible for Arab Bank or any other bank to address these allegations with any more specificity.

“As noted in the US State Department cable, Arab Bank is one of the ‘most respected banks in the Middle East’, with a network that spans 30 countries and five continents. The bank maintains a state of the art compliance programme, works closely with banking regulators in all countries where it operates, and has a long history of providing safe and secure banking services,” the spokesperson stressed.

A US embassy official in Amman told The Jordan Times last week that the embassy’s policy is not to comment on WikiLeaks cables.

As it sought to stop North Korea from spreading its nuclear technology, the U.S. uncovered signs in 2007 that the country was channeling funds through a major Middle Eastern bank based in Jordan, one of its closest regional allies, according to diplomatic cables posted online by document leaking website WikiLeaks.

In the cables, viewed by The Wall Street Journal, U.S. officials warned their counterparts in Jordan that North Korea was using Amman-based Arab Bank PLC to receive money from Syria and Iran, circumventing international sanctions.

The U.S. has said, apart from the cables, that it believes Syria purchased North Korean nuclear technology, including a nuclear reactor that Israel bombed in 2007. The U.S. also believes that Iran has acquired long-range missiles from North Korea.

“We are concerned that Iran, Syria, and DPRK [North Korea] proliferation entities are using the Arab Bank network to process what may be proliferation-related transactions,” read an August 2007 cable from the U.S. State Department to the U.S. Embassy in Amman.

The warnings provide a rare glimpse into U.S. efforts to stop North Korea from spreading arms and nuclear technology to its enemies. U.S. officials have said as recently as last month that North Korea is still aggressively establishing a network of front companies through which to secretly sell its weapons and evade sanctions.

“U.S. efforts have helped to spur isolation, but I think there is still a cat-and-mouse aspect to North Korean illicit financial activity,” Juan Zarate, a White House counterterrorism official until 2009, said Thursday.

In the cables, the U.S. said it was concerned that North Korea helped one of its lenders, Tanchon Commercial Bank, which it describes as the “primary financial agent behind the DPRK’s weapons programs,” to funnel money from Syria and Iran through Arab Bank.

The governments of Syria, Iran and North Korea didn’t respond to calls and emails requesting comment. A spokeswoman for the Jordanian Embassy in Washington declined to comment.

The cables said those transactions “have occurred through Arab Bank PLC, one of the oldest and most respected banks in the Middle East.”

Arab Bank said it didn’t believe it had processed any North Korean funds. “Based on a review of its customer account and transaction records, Arab Bank does not believe that it has conducted business with the government of North Korea or Tanchon Bank,” the bank said.

“In addition, Arab Bank has not found any records indicating that government officials provided information to the bank concerning surreptitious efforts by North Korea to move funds through its network,” it said.

The U.S. cables, which were posted at the end of August, suggest that Arab Bank may have processed the purported North Korean transactions unwittingly. They say that Tanchon was conducting its financial transfers surreptitiously using aliases and front companies.

In interviews, current and former U.S. officials said warnings such as those reported in the cables aren’t unusual and don’t indicate that they viewed Arab Bank as a particular cause for concern.

The bank was fined by U.S. banking regulators in 2005 for lacking adequate safeguards to stop money laundering and terrorist financing. Since then, a U.S. official said, Arab Bank has taken major steps to shore up its internal controls and has emerged as one of the more responsible lenders in the region.

The cables don’t say how large the purported transactions were, or their purpose. Nor do they say what, if anything, was done after the warnings.

Arab Bank is facing several civil lawsuits in a New York federal court dating to 2004 that allege it knowingly helped fund Palestinian terrorist attacks. The suits, brought by family members of those killed or injured in the attacks, allege the bank acted as a conduit for money from Saudi donors that went to families of suicide bombers and terror groups, a charge the bank denies.

In a statement, Arab Bank said it complies with banking laws in all 30 countries where it does business, including the U.S. “The bank abhors terrorism and has not done business with terrorists or terrorist organizations designated by these countries,” it said.

Jordan has interceded on Arab Bank’s behalf in the suits, arguing that the bank is being unfairly punished for failing to turn over what it says are confidential client records. In a November 2010 court brief, Jordan said a set of legal sanctions imposed by the U.S. judge hearing the case could destroy the bank. Because Arab Bank was a crucial cog in the regional economy, that outcome would be “potentially calamitous” for the economies of the Middle East, the brief said.

The appeals court has called a hearing on Nov. 14. However, Arab Bank has asked for it to be postponed as its lawyer cannot make it that day due to a conflict with another case.

While the leaked cables show the U.S. had concerns about illicit money transfers at Arab Bank two years after the 2005 punishment, they also include a U.S. expression of support for the bank. In a July 2008 cable, the U.S. Embassy in Amman said it saw no reason why the U.S. shouldn’t provide financing for Arab Bank and two other Jordanian financial institutions.

“The embassy does not have any information that these banks or their investors have known ties to terrorists, money laundering, corruption, or violations of the law,” it stated.

A bank in Jordan, a strong U.S. ally in the region, may have unknowingly moved cash for the North Koreans to finance illicit weapons programs, cables suggest.

Sensitive cables distributed by WikiLeaks and reviewed by The Wall Street Journal suggest Jordan’s Arab Bank PLC was used by North Korea to get money from Syria and Iran to help with its proliferation activity.

An August 2007 cable from the U.S. State Department to Washington’s embassy in Amman expressed concern “that Iran, Syria and DPRK (North Korea) proliferation entities are using the Arab Bank network to process what may be proliferation-related transactions.”

Arab Bank, in a statement published by the Journal, said it “does not believe” it carried out business with the North Koreans. The bank was fined in 2005 by U.S. banking regulators for not having mechanisms in place to prevent money laundering and terrorist financing, the newspaper adds.

The cables suggest the Jordanian bank processed the North Korean activity without knowing about it.

The International Atomic Energy Agency, at its regular summer meeting with the board of governors in Vienna, expressed concern about the Syrian, North Korean and Iranian nuclear programs.

UPDATE 2 (2011-6-19): According to Yonhap, a researcher at the Congressional Research Service (CRS) asserts the goal of Executive Order 13466 is to essentially facilitate ratification of the KORUS FTA by preventing the importation of goods made in the Kaesong Industrial Zone into the United States:

A recent executive order issued by U.S. President Barack Obama is partly aimed at banning the imports of products made at an inter-Korean industrial park in Kaesong, a North Korean border town, ahead of the ratification of a free trade pact with South Korea, a Congress-affiliated researcher said Wednesday.

Dick Nanto, a specialist in industry, trade and foreign affairs with the Congressional Research Service (CRS), noted that the April executive order prohibits the direct and indirect entry of North Korean goods.

“The Treasury Department’s Office of Foreign Assets and Control said goods, services and technologies from North Korea may not be imported into the United States directly or indirectly without license,” he said at a forum hosted by Korea Economic Institute.

He said the wording “indirect” was inserted in consideration of Congress’s objection to the inclusion of Kaesong products in the South Korea-U.S. free trade agreement, or KORUS FTA.

“That includes any country — China, South Korea — any country that uses a product of North Korea in the process or as part of the process,” Nanto said.

Executive Order — Prohibiting Certain Transactions with Respect to North Korea

By the authority vested in me as President by the Constitution and the laws of the United States of America, including the International Emergency Economic Powers Act (50 U.S.C. 1701 et seq.) (IEEPA), the National Emergencies Act (50 U.S.C. 1601 et seq.), section 5 of the United Nations Participation Act of 1945 (22 U.S.C. 287c) (UNPA), and section 301 of title 3, United States Code, and in view of United Nations Security Council Resolution (UNSCR) 1718 of October 14, 2006, and UNSCR 1874 of June 12, 2009,

I, BARACK OBAMA, President of the United States of America, in order to take additional steps to address the national emergency declared in Executive Order 13466 of June 26, 2008, and expanded in Executive Order 13551 of August 30, 2010, that will ensure implementation of the import restrictions contained in UNSCRs 1718 and 1874 and complement the import restrictions provided for in the Arms Export Control Act (22 U.S.C. 2751
et seq.), hereby order:

Section 1. Except to the extent provided in statutes or in licenses, regulations, orders, or directives that may be issued pursuant to this order, and notwithstanding any contract entered into or any license or permit granted prior to the date of
this order, the importation into the United States, directly or indirectly, of any goods, services, or technology from North Korea is prohibited.

Sec. 2. (a) Any transaction by a United States person or within the United States that evades or avoids, has the purpose of evading or avoiding, causes a violation of, or attempts to violate any of the prohibitions set forth in this order is prohibited.

(b) Any conspiracy formed to violate any of the prohibitions set forth in this order is prohibited.

Sec. 3. The provisions of Executive Orders 13466 and 13551 remain in effect, and this order does not affect any action taken pursuant to those orders.

(c) the term “United States person” means any United States citizen, permanent resident alien, entity organized under the laws of the United States or any jurisdiction within the United States (including foreign branches), or any person in the United States;

(d) the term “North Korea” includes the territory of the Democratic People’s Republic of Korea and the Government of North Korea; and

(e) the term “Government of North Korea” means the Government of the Democratic People’s Republic of Korea, its agencies, instrumentalities, and controlled entities.

Sec. 5. The Secretary of the Treasury, in consultation with the Secretary of State, is hereby authorized to take such actions, including the promulgation of rules and regulations, and to employ all powers granted to the President by IEEPA and the UNPA as may be necessary to carry out the purposes of this order. The Secretary of the Treasury may redelegate any of these functions to other officers and agencies of the United States Government consistent with applicable law. All agencies of the United States Government are hereby directed to take all appropriate measures within their authority to carry out the provisions of this order.

Sec. 6. This order is not intended to, and does not, create any right or benefit, substantive or procedural, enforceable at law or in equity by any party against the United States, its departments, agencies, or entities, its officers, employees, or agents, or any other person.

Sec. 7. This order is effective at 12:01 a.m. eastern daylight time on April 19, 2011.

TEXT OF A LETTER FROM THE PRESIDENT TO THE SPEAKER OF THE HOUSE OF REPRESENTATIVES AND THE PRESIDENT OF THE SENATE

April 18, 2011

Dear Mr. Speaker: (Dear Mr. President:)

Pursuant to the International Emergency Economic Powers Act (50 U.S.C. 1701 et seq.) (IEEPA), I hereby report that I have issued an Executive Order (the “order”) that takes additional steps to address the national emergency declared in Executive Order 13466 of June 26, 2008, and expanded in Executive Order 13551 of August 30, 2010.

In 2008, upon terminating the exercise of certain authorities under the Trading With the Enemy Act (TWEA) with respect to North Korea, the President issued Executive Order 13466 and declared a national emergency pursuant to IEEPA to deal with the unusual and extraordinary threat to the national security and foreign policy of the United States posed by the existence and risk of the proliferation of weapons-usable fissile material on the Korean Peninsula. Executive Order 13466 continued certain restrictions on North Korea and North Korean nationals that had been in place under TWEA.

In 2010, I determined that the Government of North Korea’s continued provocative actions destabilized the Korean Peninsula and imperiled U.S. Armed Forces, allies, and trading partners in the region, and warranted the imposition of additional sanctions, and I issued Executive Order 13551, expanding the national emergency declared in Executive Order 13466. In Executive Order 13551, I ordered blocked the property and interests in property of three North Korean entities and one individual listed in the Annex to that order and provided criteria under which the Secretary of the Treasury, in consultation with the Secretary of State, may designate additional persons whose property and interests in property shall be blocked.

The United Nations Security Council, in Resolutions 1718 and 1874, requires Member States to take certain measures to prevent, among other transactions, the importation of certain goods and services from North Korea. The sanctions contained in Executive Order 13551 strengthen the implementation of these Resolutions.

I have issued the order today to further address the national emergency with respect to North Korea and ensure implementation of United Nations Security Council Resolutions 1718 and 1874. The order also complements executive authorities under section 73 of the Arms Export Control Act to ensure that all imports from North Korea are consistent with the import restrictions described in that provision, even when relevant designations under that provision are not in effect. To accomplish these goals, the order prohibits the direct or indirect importation of goods, services, and technology from North Korea. Unless exempt, all imports into the United States from North Korea must be authorized.

The order leaves in place all existing sanctions imposed under Executive Orders 13466 and 13551.

I have delegated to the Secretary of the Treasury the authority, in consultation with the Secretary of State, to take such actions, including the promulgation of rules and regulations, and to employ all powers granted to the President by IEEPA and the United Nations Participation Act as may be necessary to carry out the purposes of the order. In particular, this delegated authority may be used to establish a process to consider licenses for imports from North Korea that are consistent with the purposes of the order.

The order is effective at 12:01 a.m. eastern daylight time on April 19, 2011. All executive agencies of the United States Government are directed to take all appropriate measures within their authority to carry out the provisions of the order.

Monday’s order further expands on an executive order imposed in August 2010 (pdf), and another in 2008. Both remain in effect under this order. In a letter to the House Speaker and the president of the Senate, Obama said the order prohibits the direct importation of goods, services or technology from North Korea.

“Unless exempt, all imports into the United States from North Korea must be authorized,” the letter says.

The goal of the latest executive order is to further implement two United Nations Security Council resolutions, 1718 and 1874, which tasked member states to prevent certain transactions and imports from North Korea. The latest issuance sends a signal that the prior orders weren’t enough, however.

Treasury is tasked with coming up with rules on how to enforce the sanctions and issue import licenses under the order. It went into effect at midnight Tuesday.

The US Treasury also blacklisted another North Korean bank. According to Reuters:

The U.S. Treasury on Tuesday imposed sanctions on North Korea’s Bank of East Land over transactions with a blacklisted North Korean arms maker that it said has exported torpedoes to Iran.

The Treasury said the action was taken under an August 2010 White House executive order that aims to thwart North Korea’s arms trade, luxury goods imports, narcotics trafficking and money laundering.

The move seeks to freeze any Bank of East Land assets that may be under U.S. jurisdiction and bans U.S. entities from transactions with the institution, also known as Dongbang Bank.

The Treasury has fought a long-running sanctions battle against illicit activities of the North Korean government, including its alleged manufacturing of high-quality counterfeit $100 bills known as “supernotes.”

“Bank of East Land is a major conduit for facilitating North Korea’s conventional arms trade,” David Cohen, the Treasury’s acting under secretary for terrorism and financial intelligence, said in a statement.

“Today’s designation exposes North Korea’s efforts to circumvent sanctions to conduct illegal activities and degrades its ability to abuse the international financial system,” Cohen said.

The Treasury said Bank of East Land has facilitated transactions for Green Pine Associated Corp, a North Korean arms manufacturer and exporter that was previously placed on the U.S. sanctions list. It said Green Pine produces submarines, military boats and missile systems and has exported torpedoes and technical assistance to Iranian defense-related firms.

In 2007 and 2008, the bank also facilitated transactions involving Green Pine and two blacklisted Iranian financial institutions, Bank Melli and Bank Sepah, the Treasury said. The Iranian state banks previously were sanctioned under an executive order aimed at curbing Iran’s nuclear and missile development efforts.

In 2005, the Treasury blacklisted a small bank in Macau, Banco Delta Asia, which cut off Pyongyang’s primary conduit to the international financial system at that time. The move was separate from sanctions aimed at curbing North Korea’s nuclear program but added pressure on the reclusive communist regime to bring it back to multilateral nuclear talks.

I can only assume March 11 was a slow news day in Israel – though there was plenty going on in the neighborhood. Otherwise, why would that distinguished daily, the Jerusalem Post, deem it worthwhile to devote quite a long article, in its International Section, to the exciting, world-shattering news that Israel now boasts a North Korea friendship group?

The moving spirit is one Shmuel Yerushalmi: originally from Ukraine, now of Beersheba. Many former Soviet Jews who moved to Israel are conservative, but not Shmuel. An avowed Marxist-Leninist, he’s quoted as saying that the true dictators of the modern world aren’t the likes of Kim Jong-il of North Korea – he also cites Libya’s Muammar Gaddafi and Belarus’ Alexander Lukashenko – but the leaders of the US and “Western empires”. Whatever you say, comrade.

Alejandro Cao de Benos, who runs the Korea Friendship Association, confirmed that KFA has an Israeli branch, with a mailing list of around 60, and a Hebrew section of its website. He added that they have “two major responsibilities”: translating information about North Korea into Hebrew, and creating an Israeli support base that can lead to cultural exchanges. Turning the turgid works of the Great Kims into Hebrew: that should keep Shmuel busy.

For any readers unfamiliar with the KFA, its site claims to be the “Official Webpage of The Democratic People’s Republic of Korea.” Actually it is a fan site. Cao de Benos dresses like Kim Jong-il, and touchingly refers to North Korea as “We” (as in the Jerusalem Post article). He can be seen online declaring: “I Will Be A Soldier of Marshal Kim Jong-il” – but hurry! For some reason the video is to be pulled on April 29. I do hope Cao de Benos will post it elsewhere.

On KFA’s true status, the article quotes a leading British expert: Hazel Smith of Cranfield University, who lived and worked in Pyongyang for two years. Professor Smith briskly dismisses KFA as “extreme” and of “no influence … they are a bunch of individuals who are a mixture of the curious, the naive and those who just want a free trip somewhere”. Ouch. But true.

Intriguingly, Cao de Benos told the Jerusalem Post that he planned to travel to Pyongyang shortly, taking with him “American Jewish lobbyists linked to Israel, some of whom live in Tel Aviv”. But he refused to name these. A tall story? Not wholly implausible, as we shall shortly see.

As for Yerushalmi, he hasn’t actually made the pilgrimage to Pyongyang yet – but there is nothing to stop him. Apparently worried whether all this was politically kosher, the Jerusalem Post asked the foreign ministry. Spokesman Yigal Palmor called it “a particularly misplaced form of friendship expression, but it’s not illegal and not something we are going to interfere with”.

The [Wikileaks] cables say that North Korea received the arms payments through the Seoul branch of Iran’s Bank Mellat and that the U.S. government urged the South Korean government to investigate the matter. According to a cable dated March 24, 2008, a company in Iran called Hong Kong Electronics wired $2.5 million in three separate payments from Parsian Bank in Iran to the Seoul branch of Bank Mellat in November of 2007. Hong Kong Electronics is a paper company owned by North Korea’s Tanchon Commercial Bank. The money was wired entirely in euros, and $1.5 million worth of the payment was then wired to accounts in China and Russia.

Following a U.S. request to investigate, the South Korean government probed the Bank Mellat branch in December 2008 but did not take any punitive measures. Washington then demanded that the branch’s assets be frozen, according to a cable dated May 12, 2009.

In an exclusive interview with the JoongAng Ilbo on Friday at the Iranian Embassy in Seoul, Mehmanparast stressed that Bank Mellat’s Seoul office ran its business “under the supervision of South Korean financial authorities.”

Iran’s new ambassador to South Korea, Ahmad Masoumifar, sat in on the interview.

Mehmanparast was in Seoul with seven Iranian journalists to improve relations with the Korean Ministry of Foreign Affairs and Trade.

The South Korean government in September slapped tough sanctions on Iran for its nuclear program, with penalties including the suspension of virtually all financial activities at the Seoul branch of Iran’s Bank Mellat.

The South Korean government said its actions complied with United Nations Security Council resolutions.

Q. Cables released by WikiLeaks suggested that North Korea likely received payment for weapons sold to Iran through Bank Mellat’s Seoul Branch.

A. I think there’s someone behind the allegations in regard to Wikileaks’ information on Iran. Bank Mellat operates abiding South Korean law. There’s nothing wrong with the bank. We do maintain diplomatic ties with the North Korean government. But Iran doesn’t damage (diplomatic) relations with one country for the sake of relations with another country.

Q. What about allegations that Iran and North Korea are cooperating on nuclear technology?

A. Iran and North Korea aren’t in a military alliance. Frankly speaking, when it comes to nuclear weapons, Iran doesn’t need other countries’ assistance.

Iran’s young scientists are in the process of successfully developing technology to use nuclear power in a peaceful manner.

Q. What’s Iran’s official position on North Korea’s attacks on the South Korean warship Cheonan and Yeonpyeong Island?

A. It was heartbreaking when I heard the news about the Yeonpyeong attack. I hope peace is maintained in Asia. I want to again stress peace through dialogue.

Q. Iran is an oil rich country. Why does it need nuclear power?

A. The Western media also questions why Iran needs nuclear power. But when you look at the world’s latest economic trends, nuclear power is (increasingly important) when used in a peaceful way. Even the United Arab Emirates began nuclear cooperation with the South Korean government.

Crude oil will be depleted in the future. Nuclear power is an answer to that, and it’s necessary for environmental reasons, too.

Q. Former Iranian Ambassador to Korea Mohammad Reza Bakhtiari said in a previous interview with our paper that Iran won’t sit back and watch if the South Korean government joins international sanctions against Iran.

A. That’s an uncomfortable question to answer. South Korea and Iran have lots in common as Asian nations. I hope for South Korean companies’ prosperity in Iran and I also hope for the success of Iranian companies in South Korea.

The use of an Australian-owned cargo ship to smuggle weapons from North Korea to Iran has been highlighted in a report to the UN.

It was one of several breaches of UN sanctions against Kim Jong-il’s regime detailed in a report to the Security Council.

The report, which was submitted to the council recently after months of obstruction from China, found the North was making $US100 million a year through illegal arms sales to Syria, Iran and Burma.

Pyongyang used shadowy webs of front companies, false manifests and complex routes to try to get around sanctions aimed at stopping its arms proliferation, the investigation found.

The report flags the 2009 interception of the ANL Australia in Sharjah as one of at least four occasions that North Korea was caught out exporting arms or defence equipment.

The report said weapons were seized from the ANL Australia in the United Arab Emirates on July 22, 2009.

The cargo is thought to have included up to 10 containers of arms, including rocket-propelled grenades and trigger mechanisms and propellant, although this is not detailed in the report.

The cargo was packed and sealed in North Korea and shipped to China, where it was loaded aboard the ANL Australia en route to Iran.

The Bahamas-flagged vessel was owned by ANL Container Line at the time.

ANL, once Australia’s national shipping line, was taken over by French company CMA CGM.

Despite the breach of sanctions, an Australian government investigation found ANL was not responsible because the ship was chartered by a foreign company at the time.

“The Australian government’s inquiries into this matter indicated that at all relevant times the vessel was not under the operational control of its owner, but was rather being chartered by a non-Australian company,” a Department of Foreign Affairs and Trade spokesman said.

“No conduct relevant to the shipment can be attributed to an Australian person or body corporate,” he said.

ANL declined to comment.

The report found that while no ballistic missile or nuclear-related materials emanating from North Korea had been intercepted since sanctions were applied, evidence suggested “continuing DPRK (North Korea) involvement in nuclear and ballistic missile-related activities in certain countries, including Iran, Syria and Myanmar (Burma)”.

“To supplement its foreign earnings, the DPRK has long been involved in illicit and questionable international transactions (including) the surreptitious transfer of nuclear and ballistic missile-related equipment, know-how and technology,” it says.

The panel received government reports suggesting North Korea had helped build Syria’s Dair Alzour nuclear facility (destroyed in 2007 by an Israeli attack) along with details of Japan’s arrest in June 2009 of three individuals trying to illegally export a magnetometer, a device with potential missile-related uses, to Burma.

Mohammed Reza Heydari, Iran’s former consul in Norway, sought political asylum in December amid protests in his homeland in the aftermath of Iranian President Mahmoud Ahmadinejad’s disputed re-election.

On Tuesday he told reporters at a meeting organised by the Paris-based think tank the Centre of Political and Foreign Affairs that he had seen North Koreans when he had been a foreign ministry official at Tehran airport.

“I saw them with my own eyes,” he said. “They were treated in a very discreet manner, in order to pass through without being seen.”

Heydari said he was “100 percent certain” that these contacts continue and alleged he had spoken to members of Iran’s hardline Revolutionary Guards Corps who confirmed that Iran plans to build a bomb.

“I was able to confirm that Iran has two goals — to develop the range of its ground-to-ground missiles and to obtain a nuclear weapon with the help of North Korea,” he said.

Since defecting, Heydari has sought to convince more Iranian diplomats to abandon the regime and form an opposition movement in exile.

Describing his view of the political scene back in Tehran, Heydari said a group of conservatives around the speaker of parliament Ali Larijani were increasingly opposed to a more religious faction backing Ahmadinejad.

According to the defector, while Larijani’s group wants to govern Iran, Ahmadinejad’s supporters have a more “global agenda” and are awaiting the return of the “hidden imam”.

Some Shiite Muslims believe that the 12th Imam, known as the Mahdi, who disappeared in the year 874, will return to bring justice to the world.

Heydari said Ahmadinejad’s faction is pushing Iran’s nuclear agenda. “According to our information, this inner circle believes that with only two bombs they can ensure the survival of the country and of Islam,” he said.

The usual defector caveats apply. According to Bob Baer, Iran’s nuclear program has been an intelligence black hole. Of course so was the DPRK’s—and they managed to surprise everyone by bulding a LEU facility right in the middle of Yongbyon. There is no shortage of evidence that the two countries are working together on a number of political, economic, and military initiatives, however, so it is entirely possible that this Iranian defector is telling the truth.

As an aside, many Americans are nervous about visiting both Iran and the DPRK, but having visited nearly 45 countries, I can tell you that Iran and the DPRK are in the top three for me. Of course, I live on the beach and prefer to “rough it” on vacation.